Navistar boss Troy Clarke has revealed that the brand’s strategic alliance with Volkswagen Truck & Bus was born through a discussion between the two brands about the future of the industry just five months ago.

Clarke told media at the Hannover truck show that the initial meetings took place in March and quickly developed into the deal which will see Volkswagen purchase a 16.6 per cent stake in Navistar and gain two seats on the board.

“We started to talk about our visions of the future of the truck industry and that led to a series of opportunities to sit down and continue this dialogue about what the future of the industry looked like. At some point in time, we said why not see if there is something we can do together,” Clarke said.

The alliance will see Volkswagen bring an integrated powertrain to International trucks and the two companies collaborate on future technologies to reduce costs.

VW commercial boss Andreas Renschler believes partnership will bring significant benefit.

“We are looking forward to a really successful alliance and I think we have very good chance. From my point of view, it’s a natural fit at the right moment” Renschler said.

Navistar is currently redesigning its line-up, while VW is working towards a new powertrain to be rolled out in 2020 or 2021. The new alliance will see both companies work towards an integrated platform.

VW will gain its long-desired foothold in the US market, while Navistar will gain a significant financial boost from the deal.

“It doesn’t solve all the problems but it creates opportunities that didn’t exist six months ago for us,” Clarke said.

“Our business is operating as well as, or better than, it has in a long time. We are well positioned for what’s next,” he added.

Given Mr Clark has just had a $254 million cash injection they should be well positioned. The industry awaits the next moves by VW.